Provincial licensing for education agencies abolished
Study abroad agencies in China will no longer need to be licensed by provincial authorities in order to operate. This will make it easier for newer businesses to enter a market that is currently dominated by larger, long-established brands. The PIE News
KIM’S NOTE: This announcement was surprising as it represents a lessening of regulation, which is contrary to the larger trends in China of tighter controls. This seems like big news, but as it applies to the retail agency business I can’t see how these new regulations will impact institutions greatly. In the retail agency space, the barrier to entry (in most cases) is not Chinese ownership and invested capital, but rather having the marketing reach to draw the Chinese consumer over the agency threshold. Even the large agency brands are having a harder time with that. But where the regulations might have a noticeable impact is in two secondary areas. The first is the new regulations may make it easier for small, local companies to operate as embedded guidance offices within high schools and study abroad offices in HEIs. The second is new regulations may facilitate new technology-driven recruitment models that otherwise might have been impossible within a stricter regulatory framework. Indeed, the elimination of licensing requirements may appear to be pro-agency but in fact it may ultimately end up disrupting the traditional agency business model.